Houses sell ‘for substantial discounts’

People trying to sell their homes are having to substantially lower their initial price aspirations to get the property away, new data shows.

A report by property information provider RP Data shows that vendors are having to cut the original sale price by almost eight per cent in capital cities amid the tough economic climate.

Some coastal areas recorded discounts close to 20 per cent.

The report on property discounting measures the initial advertised price of a property against its ultimate sale price.

RP data research analyst Cameron Kusher said high levels of discounting suggests that listing prices may be out of line with what the market is willing to pay for properties.

But he said it is no surprise to see suburbs known for their coastal lifestyle such as Byron Bay, Paradise Point, Wangi Wangi and San Remo on the list.

Houses in these types of locations can be described as “discretionary assets”.

“As high net worth individuals feel the pinch of dramatic falls across equity markets, lower than anticipated bonuses and in some cases job losses, the holiday home or other discretionary assets are usually the first to go,” Mr Kusher said.

Among the capitals Melbourne experienced the greatest level of discounting in the 12 months to February, where in order to achieve a sale, houses averaged discounts of around 7.7 per cent.

At the other end of the scale, Darwin recorded the lowest level of discounting at 3.8 per cent.

For units, Perth recorded the greatest average discounting at 7.1 per cent, while Canberra saw the smallest at 3.6 per cent.

In the suburbs, Perth’s Saint James saw house discounting of 18.6 per cent, South Australia’s Hove recorded 18.2 per cent, Queensland’s Paradise Point 17.3 per cent and NSW’s Bryon Bay 17.3 per cent.

And if you are thinking of selling a unit in South Australia’s Aldinga Beach, you may have to drop the price by a whopping 23 per cent.